Condo Questions: Owners at fault for failure to comply

Q: I live in a condominium complex that recently did cleaning in our underground parking lot. A notice was posted for all residents to remove their vehicles from the parking lot by 8 a.m. on the scheduled date. I leave for work at 8:30 a.m., so I went to the parkade at 8:30 a.m. and my car was not there. Property management towed my car and left it in a shopping centre parking lot across the street. They sent me an invoice for $317, stating a $117 towing expense and $200 bylaw penalty. Is this legal?

Robert Noce, Edmonton Journal

Updated: October 7, 2016

Condo owners have little recourse or reason to complain if they fail to comply with notices issued by property management. Jonathan Hayward / Canadian Press

Q: I live in a condominium complex that recently did cleaning in our underground parking lot. A notice was posted for all residents to remove their vehicles from the parking lot by 8 a.m. on the scheduled date. I leave for work at 8:30 a.m., so I went to the parkade at 8:30 a.m. and my car was not there. Property management towed my car and left it in a shopping centre parking lot across the street. They sent me an invoice for $317, stating a $117 towing expense and $200 bylaw penalty. Is this legal? Do I really need to pay $317 for being late by 30 minutes? This caused me go to work more than one hour late, and when I contacted the property manager they said this is the bylaw and I have to pay. This is my registered parking spot and my vehicle was towed without any notice. Please let me know what I should do.

A: First of all, you did have notice. There was a notice posted asking all residents to remove their vehicles from the parkade by 8 a.m. on a specific date so that the parkade could be cleaned. Parkade cleaning is something that owners pay for through their condominium fees. The notice was clearly posted and you chose to ignore it, because you did not want to inconvenience yourself by leaving for work at 8 a.m. instead of 8:30 a.m. As a result of your failure to comply, you were more than one hour late for work, and you have to pay fines. In order to prevent this from happening, you could have complied with the notice, inconvenienced yourself for one day, and either stopped for coffee on your way to work, or brought a book to read before beginning your workday, or simply started work early one day out of the year.

Helpful Hint: Sometimes people are the authors of their own misfortunes, and this is one such example. Also, condominium corporations can only issue fines if their bylaws allow for them.

Q: I am the condominium board treasurer, and we are terminating the contract with our current condominium management company as of November 2016, which is the end of the management agreement year. We advised the management company of the termination by registered letter in July 2016. Our relationship with the management company has deteriorated over the months as a result of overall lack of performance, communication and response on their part. After receiving our July 2016 financial statements, it came to our attention that the management company withdrew three months of management fees, plus an adjustment fee, from our operating account as “prepaid management fees” for a three-month period. Our agreement does not allow for prepaid management fees. We feel that this withdrawal by the management company is not only a violation of the management agreement, but also a dishonest act in violation of the law. Is there anything we can do about this?

A: Based on your question, it would appear that the property management company had no right to prepay itself for the remaining three months. However, given the fact that they only took what was payable to them over the three-month period, I do not think you have any claim against them because there are no damages, as they did not take more than they would have ultimately been entitled to be paid. Unfortunately, there is not much you can do. However, the property management company should not do these kinds of things, as it reflects poorly on them. As with most things, people talk about the services they receive, and this will have an impact on the outgoing property management company.

Helpful Hint: The good news is that changes are coming when the amendments to the Condominium Property Act become the law. Unfortunately, we do not know when they will become the law, as we are now entering into our second year since the amendments were passed (in December 2014). Under the amendments that are coming, property managers will be regulated and the Real Estate Council of Alberta will have an opportunity to deal with any complaints that condominium corporations may have in regard to the service delivery of the property management company.

Q: Our condo board and/or property manager have sent out a notice of our annual general meeting (AGM) for October 26, 2016. On October 20, 2015, a motion was made at our AGM “to hold the 2016 AGM meeting prior to October 12.” That motion was seconded and carried. Is it illegal for this meeting to be called for October 26, 2016? What action can we take other than to complain to both the property manager and the board?

A: When owners pass a resolution directing the board to do something, the board is required to follow that direction. It is clear from your question that the board failed to follow the direction of the owners and are planning to hold the meeting after October 12, 2016. The October 26, 2016 meeting is not illegal, and as long as everything is done correctly from a procedural standpoint, then everything is perfectly fine. You need to remind the board and the property manager that the Condominium Property Act is clear in that owners can provide direction to the board and the board must follow that direction. Other than that, there is not much more you can do and it is not worth pursuing in a court of law.

Helpful Hint: Property managers and boards need to be aware of Section 28(7) of the Condominium Property Act, which clearly indicates that boards’ decisions are always subject to any restriction imposed or direction given in a resolution passed at a general meeting of the owners.

Q: I live in a 10-year-old condominium unit. The board is undertaking some foundation and parking roof water leak issues on one side of the building. The association will pay for these repairs because the five-year warranty period has expired. One of the neighbours of the affected units has mentioned the owners may have been aware of the leak for quite some time, but failed to report it in a timely manner. The neighbour is a past board member and mentioned this to us in casual conversation. If this is factual, that the unit owner did know about the leak prior to the warranty expiration, would the condo association be able to recover some of the costs through the owner?

A: Probably not, as the facts in this case would be critical in providing a definitive position. However, I would not spend much time dwelling on that because it would be very difficult to prove that the owner is somehow liable for this.

Helpful Hint: When owners see a problem in the building, they should advise the board and/or property manager promptly of their concerns. The board and/or property manager must then react in a timely manner.

Q: I recently moved into a condo, and have just learned that the board president works as a manager for the condo’s property management company. Is this allowed? The board meets once per year, and in that meeting the board president is elected as a result of the units owned by the company proxying votes to her. Is any of this legal?

A: Although there is nothing illegal with having the board president associated with the property management company, it does present a potential conflict situation. The board president cannot vote or participate (or even be in the room) when an issue arises with respect to the property management company. If the president participates, stays in the room, or votes on an issue relating to the property management company, the whole voting process could be called into question. There is nothing illegal about the board meeting only once a year (unless your bylaws say otherwise) but this seems low to me. Then again, I do not know the size of your condo complex or the issues your condominium is dealing with. Usually, the officer positions (president, vice-president, etc.) are chosen at the board level (by board members — one vote per board member) and not by individual owners.

Helpful Hint: Although not illegal, you are asking for problems when you expose yourself to potential conflict situations. It is critical to have clear guidelines and an understanding what is or is not a conflict.

Robert Noce, Q.C. is a partner with Miller Thomson LLP in both the Edmonton and Calgary offices. He welcomes your questions at rgarner@edmontonjournal.com. Answers are not intended as legal opinions; readers are cautioned not to act on the information provided without seeking legal advice on their unique circumstances. Follow Noce on Twitter at @RobertNoce.

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